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Corporate Governance, External Governance Environment And Corporate R & D Investment

Posted on:2017-01-25Degree:MasterType:Thesis
Country:ChinaCandidate:S ZouFull Text:PDF
GTID:2309330485460910Subject:Accounting
Abstract/Summary:PDF Full Text Request
With the increase of labor costs and resource costs, Technological innovation has become a key factor in enhancing the competitiveness of enterprises as well as promoting the progress of the entire nation. We all know that to achieve sustainable development of Chinese economy, we must transform the economic growth mode to rely more on technology and knowledge. In recent years, China’s total R&D investment continued to rise, According to the National Bureau of Statistics, China’s R&D investment in 2014 has reached 1.30156 trillion yuan. However, as far as our R&D intensity (R&D expenditure to GDP ratio), there is still a gap between the level of China and developed countries.Enterprise is one of the most important innovation subject, The development of modern enterprises must rely on innovation, only in this way can enterprise and nation get a long-term, sustainable development. Therefore, how to effectively improve our corporate R&D investment, and ultimately improve technological innovation has become an academic focus.Scholars at home and abroad had a full discussion on the factors affecting the strength of corporate R&D investment, including macroeconomics, government subsidies and other macro-level factors, scale enterprises, financial indicators, corporate governance and other microeconomic factors. But these studies are mostly from a single dimension, the company itself or the external environment. The reality is China is a vast country, the external governance environment differ greatly from region to region, Considering that companies operate under specific external governance environment, the effectiveness of coiporate governance in promoting R&D expenditure is inevitably affected by the corporate’external environment. There are two basic hypotheses about the impact of external governance environment on the effectiveness of corporate governance, Complementary hypothesis and alternative hypothesis. And this paper argues that the matters about alternative or complementary relationship and the strength of this relationship are relative to the nature of the company’s property.This study selected the 2010-2014 A-share listed companies in industries of manufacturing, information transmission, software and information technology services, scientific research and technical services as samples, selected R&D investment accounted for operating income as the R&D intensity index. On the basis of previous research, this study also selected 17 corporate governance evaluation indexes, and through principal component analysis, we can get the score of coiporate governance of state-owned enterprises and non state-owned enterprises from those 17 indexes. And then we can explore the relationship between corporate governance and R&D investment through regression analysis. Based on the above analysis, we selected market-oriented process, the relationship between government and the market, degree of finance marketization, and development of market intermediary organizations and legal environment level from "NERI INDEX of Marketization of China’s Provinces 2011 Report" as external governance environment variables, through hierarchical regression, we explore how the external governance environment affect the relationship between company governance and R&D investment when the samples was divided into state-owned enterprises and non state-owned enterprises group.Empirical results show improvement of corporate governance is good for R&D investment. The enhancement of market process significantly improve the effectiveness of state-owned enterprises governance in the promotion of R&D investment. Weak level of market process can promote the non-state-owned enterprises governance’ protective effects, but the promotion is not statistically significant. Specific to the sub-index, the reduction of government intervention, and the improvement of level of the rule of law significantly improve the effectiveness of state-owned enterprises governance in the promotion of R&D investment. The strong government intervention and weak level of financial development can significantly promote the non-state-owned enterprises governance’protective effects.
Keywords/Search Tags:corporate governance, external governance environment, R&D investment, principal component analysis
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